One of the numerous prognosticators that became more bullish on the stock was Hans Chung of KeyCorp's KeyBanc, who lifted his price target on it by 4% to $190. As that number is 39% over the current stock price, Chung is maintaining his overweight (i.e., buy) recommendation on the shares.
A good quarter certainly helped. For that third quarter, while revenue inched up only 1% on a year-over-year basis to 28 billion yuan ($4.3 billion), non-GAAP net income flew 38% higher to land at almost 4.4 billion yuan ($669 million). Both line items were higher than the average analysts estimates, with the latter notching a convincing beat.
Chung feels that Baidu's critical top-line component, ad revenue, is going to see a boost as the Chinese economy recovers from the coronavirus outbreak; he expects this improvement to kick in as soon as this current quarter (the fourth quarter).
Bullish for quite some time on the company's activities in the artificial intelligence (AI) field, Chung believes the company is poised to win AI business on the back of a pick-up in Chinese industrial companies' continued move toward digitalization. New infrastructure programs in the vast country could also benefit Baidu's take from AI.
A frequently acquisitive company, Baidu is also attempting to grow through asset buys. Its latest one, announced close to its third quarter results release, is of the Chinese arm of the lately controversial JOYY's YY live streaming service. The deal was valued at roughly $3.6 billion.